GFX Morning FX Commentary July 24th, 2103

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0250-1.0325

Today’s expected range for the Canadian Dollar against the Euro is 1.3580-1.3650

Today’s expected range for the Canadian Dollar against Sterling is 1.5760-1.5830

The US Dollar is mixed this morning as it is marginally stronger against Sterling but weaker against the Euro, this is on the back of strong manufacturing data out of the Euro Zone. In Europe the manufacturing report showed the first manufacturing expansion in two years which caught investors by surprise, EURO.USD jumped to trade at 1.3240 which is a recent high. The growth in manufacturing data out Europe was offset by poor manufacturing data out of China, the Chinese economy produced its lowest monthly manufacturing data over the past 11 months, the Chinese economy is also showing the greatest increase in job losses since 2009. I would expect some sort of stimulus measures to be introduced in the coming months to deal with this slowing Chinese economy which should give a boost to commodity currencies like CAD, AUD and NZD.

The Canadian Dollar spent the afternoon yesterday getting stronger and after a brief bout of weakness last night it so far has been able to maintain this strength. I will be interested to see if USD.CAD can break lower again today or will we see a pullback higher for USD.CAD. Given that USD.CAD has recovered from its recent high near 1.0600 over the past few weeks and we are now looking to see if we can break below 1.0250 I think US Dollar buyers need to look at putting on some forward contracts at these levels. I think locking up 30% of your requirements over the next 3 months would not be a bad strategy, if USD.CAD drops further then you will still have room to take advantage of the drop but if it bounces higher from these levels then at least you will have purchased some US at very attractive levels, give us a call to discuss.

With little economic data today I think we will see USD.CAD consolidate around the 1.0300 level and continue to trade back and forth as the currency pair awaits the next piece of news to get it moving again.

Have a great day.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0278			1.0337
CAD/USD		0.973			0.9674
EUR/USD		1.3236			1.3173
EUR/CAD		1.3607			1.3621
STG/CAD		1.578			1.5861
AUD/CAD		0.9482			0.9548
CAD/JPY		97.23			96.68
CAD/CHF		0.9095			0.9082
CAD/HKD		7.5457			7.4806
CAD/CNY		5.9709			5.9376
Commodities
Gold		$1,340.23			$1,328.40
OIL		$107.23			$106.16
US DOLLAR INDEX
P.CLOSE		82.08			82.31
OPEN		82.13			82.43
US 10YR YIELD		2.54%			2.51%